Coal India is in the spotlight today as its shares jumped 4%

Coal India is in the spotlight today as its shares jumped nearly 4% after announcing a planned IPO of its subsidiary Mahanadi Coalfields, even though production fell 6% in August 2026. Strong demand, higher supplies, and UBS’s ‘buy’ rating with a ₹550 target price are supporting investor sentiment. 📊 Key Updates on Coal India (September 2026) 1. Stock Market Action Coal India shares rose ~3–4% on September 2, 2026. UBS maintained a ‘buy’ rating with a target price of ₹550 per share, citing strong thermal coal demand and higher e-auction premiums. 2. Mahanadi Coalfields IPO Coal India plans to sell a 10% stake (≈66.18 crore shares) in its largest subsidiary, Mahanadi Coalfields Limited (MCL), via an Offer for Sale (OFS). IPO proceeds will go to Coal India, not MCL. Allocation: 50% QIBs, 35% Retail, 15% NIIs. Lead managers: SBI Capital, BOB Capital, Axis Capital, IIFL, IDBI Capital. MCL contributes 21% of India’s coal output and 28.4% of Coal India’s production. 3. Production & Supply Data August 2026 production fell 5.7% YoY to 47.5 MT (vs. 50.4 MT last year). Offtake rose 5.5% YoY to 60.6 MT, showing strong demand. April–August cumulative production: 267.5 MT (down 4.5%). Cumulative offtake: 322.9 MT (up 6.7%). Supplies to the power sector rose 4.5%, while non-regulated sector supplies rose 9.6%. 4. Financial Performance Q2 FY26 results (Sep 2026): Net profit: ₹4,354 crore (down 50.5% QoQ). Operating profit: ₹4,052 crore (down 60.6% QoQ). Revenue: ₹30,187 crore (down 29.7% QoQ). Margins compressed due to higher costs and weaker production. 5. Diversification Strategy Coal India is investing ₹50,000 crore in coal gasification projects and scouting for critical minerals (like lithium). Targeting 9.5 GW renewable capacity by FY30. First major gasification project underway in Odisha with BHEL, costing ₹25,000 crore.